As a freelance artist, your greatest joy is likely doing creative work, not worrying about taxes. But taxes are inevitable in any profession, and there are some extra things to know when you’re self-employed.
For instance, understanding freelance artist tax deductions can make a big difference when it comes to paying artist taxes and earning profit, so it’s good to know that information well before tax season.
As an artist, you have some unique expenses, and while some of these freelance artist tax deductions may not seem like a big deal, they can make a big difference when added up at tax time.
It’s important to track these freelance artist tax write-offs all year long. Then when you file your income tax return, the expenses will reduce your taxable income. That equates to more take-home pay and less taxes paid, always a good thing.
There are some typical freelance expenses as well as some specific to your industry that can be used as freelance artist tax write-offs. You may want to consider consulting with an expert like an accountant before determining what to track, or using an accountant at tax time and providing them with your freelance artist tax deductions.
You can’t deduct every expense incurred as there are guidelines in place, established by the federal taxing authority known as the Internal Revenue Service (IRS).
The IRS defines a business expense as one that is both ordinary and necessary. The definition of an ordinary expense is one that is common and accepted in your industry, such as artists’ pencils.
The definition of a necessary expense is one that is helpful and appropriate for your industry, but not necessarily indispensable. A class with a famous artist is an example.
Understanding the many freelance artist tax write-offs will be important as you run your business throughout the year. Establishing a system to track the expenses will make your life easier, too.
While it’s enticing to look at all your expenses as deductions, there are those not considered freelance artist tax deductions:
Freelance artist tax deductions are important to track and record. Then you’ll be prepared when tax season rolls around. Here are a few ways you can access freelance artist tax deductions:
1. Use the accounting and taxes tool available with Bonsai.
2. Track your own deductions and file your own income tax return.
3. Hire an accountant.
Remember, you can use Bonsai's free self-employment tax calculator to estimate your quarterly taxes!
Not a photographer? Find tax deductions for your specific profession below.